IBC
Discretion Vested Upon NCLT U/S 7(5)(A) IBC Cannot Be Used To Impel Financial Creditor To Consider Settlement: NCLT Chennai
The NCLT, Chennai Bench, comprising Sanjiv Jain (Member-Judicial) and Venkataraman Subramaniam (Member-Technical), has held that the discretion vested upon the adjudicating authority under section 7(5)(a) IBC cannot be used to impel the financial creditor to consider the settlement proposed by the corporate debtor. The financial creditor, Punjab National Bank, filed a petition under section 7 of the IBC, seeking initiation of CIRP against the corporate debtor. However, the adjudicating...
Resolution Professional Can Terminate Leave & Licence Agreements Even In Absence Of RERA Proceedings: NCLAT New Delhi
The NCLAT, Principal Bench, New Delhi, comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra (Member-Technical), has upheld the termination of the leave and license agreement by the resolution professional (RP) in the absence of RERA proceedings. The corporate debtor executed three separate leave and license agreements with the appellants pertaining to the use of the fourth floor of the 'Pulse Care' building. However, the RERA didn't permit the commercial use of the fourth...
Revival Of Insolvency Proceedings Permissible Despite Absence Of Revival Clause In Settlement Agreement: NCLAT New Delhi
The NCLAT, Principal Bench, New Delhi, comprising Justice Rakesh Kumar Jain (Member-Judicial), Justice Mohammad Faiz Alam Khan (Member-Judicial), and Indevar Pandey (Member-Technical), has allowed the revival of the insolvency proceedings despite the absence of a revival clause in the settlement agreement. The appeal was filed against the dismissal of the restoration application filed by the appellant. While rejecting the application, the adjudicating authority noted that there was no...
Resolution Plan Can't Be Approved By NCLT If Leasehold Rights Over Primary Assets Are Not Proved: NCLAT
The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan and Mr. Barun Mitra (Technical Member) upheld an order of NCLT Kolkata which refused to sanction a resolution plan wherein a disputed parcel of land was the primary asset.The Tribunal held that since the corporate debtor failed to prove leasehold rights over the land as the deed was executed by unauthorised persons, lacked proof of payment, and was void; the resolution plan could not be approved. ...
Inadequate Stamping Of Loan Documents Is Curable Defect, Does Not Bar Admission Of Plea U/S 7 Of IBC: NCLT Mumbai
The National Company Law Tribunal (NCLT) Mumbai bench of Shri Ashish Kalia (Judicial Member) and Shri Sanjiv Dutt (Technical Member) has held that inadequate stamping of loan documents does not bar the admission of a petition under section 7 of the IBC. Background Dombivli Nagari Sahakari Bank Ltd. (“DNS Bank”) advanced financial facilities, including cash credit and term loans, between 2014-17. The accounts of the corporate debtor were classified as Non-Performing Assets (NPA)....
NCLAT Expunges NCLT Remarks Against SBI Officials, Says Tribunal Cannot Make Stigmatic Observations Without Giving Hearing
The NCLAT, Chennai Bench, comprising Justice Sharad Kumar Sharma (Member-Judicial) and Jatindranath Swain (Member-Technical), has expunged the stigmatic remark against the SBI officials and counsel, while observing that the tribunals cannot make stigmatic observations or impose costs without giving an opportunity to be heard. The NCLT dismissed the SBI's petition under section 95 of the IBC, 2016. In the impugned order, the learned adjudicating authority observed that the counsel of ...
Recall Application Seeking Review Of NCLAT Judgment Is Not Permissible: NCLAT Chennai
The National Company Law Appellate Tribunal (NCLAT), Chennai Bench, comprising Justice Rakesh Kumar Jain (Member-Judicial) and Mr. Ajai Das Mehrotra, has held that a recall application seeking review of the NCLAT's order is not permissible. The appellant, erstwhile liquidator of the corporate debtor, filed an appeal against the decision of the adjudicating authority, which was dismissed by the NCLAT. The appellant, however, was aggrieved by some observations made against him by NCLT...
Institution Of Criminal Proceedings Against Officials Of Financial Creditor Does Not Bar Petition U/S 7 Of IBC: NCLT Cuttack
The National Company Law Tribunal (NCLT) Cuttack bench of Deep Chourasia (Judicial Member) and Babulal Meena (Technical Member) has held that institution of criminal proceedings or allegations of fraud against officials of the financial creditor do not bar an application under section 7 of the IBC. It was held that, unlike an application under section 9 of the IBC, the petition under section 7 cannot be rejected over a pre-existing dispute. Background In this case, Canara Bank...
NCLT Not Empowered To Interfere With Attachment Of Properties Under PMLA Proceedings: NCLT New Delhi
The NCLT, New Delhi Bench, comprising Shri Manni Sankariah Shanmuga Sundaram (Member-Judicial) and Shri Atul Chaturvedi (Member-Technical), has held that the NCLT lacks the authority to adjudicate upon an order issued by the adjudicating authority under PMLA or to direct the Enforcement Directorate to release the attachment. The present application was filed by the resolution professional under section 114(1) read with section 60(5) to stay the proceedings initiated by the Directorate...
NCLT Bengaluru Admits Insolvency Petition Against Dunzo Digital Private Limited For Debt Of ₹1.91 Crore
The National Company Law Tribunal, Bengaluru Bench, comprising Shri Sunil Kumar Aggarwal (Member-Judicial) and Shri Radhakrishna Sreepada (Member-Technical), has admitted the CIRP petition against Dunzo Digital Private Limited for Debt of Rs. 1.91 Crore. The section 9 IBC petition was filed by the Velvin Packaging Solutions, seeking initiation of the CIRP against the Dunzo Digital Private Limited for default in payment of debt of Rs. 2.29 Cr. inclusive of interest. The operational...
Completion Certificate Issued By Corporate Debtor With Caveat On Rectification Of Defects Is Not Unconditional Acceptance Of Work: NCLAT
The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Rakesh Kumar Jain, Justice Mohd Faiz Alam Khan and Mr. Naresh Salecha (Technical Member) dismissed an appeal filed by Operational Creditor. The Tribunal held that issuance of completion certificate containing a caveat that the defects in the work have to be rectified cannot be construed as an unconditional acceptance of work. Therefore, it held that the petition under section 9 of the IBC was rightly rejected...
Detailed Inquiry Into Legality Of Transfer Of Property Cannot Be Adjudicated In Summary Proceeding U/S 7 IBC: NCLT New Delhi
The NCLT, New Delhi Bench, comprising Shri Manni Sankariah Shanmuga Sundaram (Member-Judicial) and Shri Atul Chaturvedi (Member-Technical), has held that a deeper inquiry into the legality of the transfer of property or allegations of fraud cannot be adjudicated in a summary proceeding under Section 7 of the IBC. The Section 7 application was filed by the financial creditor seeking initiation of the CIRP against the corporate debtor for default of Rs. 9.44 Cr. A loan against...